The Return of the CEO (Chief Electricity Officer)

Just when you think a battle is well and truly over, history has a habit of turning around to tweak your nose. One of the common big ideas of the moment in IT is that computing is becoming a utility. One of the key arguments underpinning this thinking comes from industrial history, calling out electricity as a model for IT provision. High profile exponents of the argument include Sun CEO Jonathan Schwartz and Nicholas Carr, rhetorician, comedian, and sworn enemy of IT snake-oil.

It took about a decade for those deploying electricity to settle on a few standards that ultimately accelerated consolidation. From voltage to cycle to plug configuration. (The processes used to get there, although they involved far more violence and loss of animal life, bear a remarkable resemblance to standard setting in the computing industry.) Spooling forward, once the standards existed, businesses could plug into a grid – labor markets went through a fairly sizable dislocation (all those engineers and “CEO’s” had to find other work), but electricity was firmly established as a ubiquitous service.

I started reading The Big Switch the other day, Nicholas Carr’s follow up to Does IT Matter? I am a sucker for arguments from history, and Nick is a good exponent of same. Back in 1892 corporations needed a chief electricity officer to ensure supplies of this most vital commodity. But just a few years later nobody did.

A hundred years ago, companies stopped generating their own power with steam engines and dynamos and plugged into the newly built electric grid. The cheap power pumped out by electric utilities didn’t just change how businesses operate. It set off a chain reaction of economic and social transformations that brought the modern world into existence. Today, a similar revolution is under way. Hooked up to the Internet’s global computing grid, massive information-processing plants have begun pumping data and software code into our homes and businesses. This time, it’s computing that’s turning into a utility.

The shift is already remaking the computer industry, bringing new competitors like Google and Salesforce.com to the fore and threatening stalwarts like Microsoft and Dell. But the effects will reach much further. Cheap, utility-supplied computing will ultimately change society as profoundly as cheap electricity did.

Whether or not Jonathan and Nick are right, it does seem ironic that just as, according to Nick, we no longer need the anachronistic CIO… the Chief Electricity Officer is seemingly about to make a comeback… A PR and communications company recently initiated a debate on the subject, based on primary research:

Seventy-seven percent of business decision makers believe there is a need to expand the C-Suite to include a Chief Energy Officer to manage, implement and measure a company’s return on investment in environmental technology, the so-called Return on Environment, according to a new global survey (PDF) released by Hill & Knowlton.

Beyond the possibility of such a role, we can see hints it is emerging. News is coming fast from Google, for example, on the energy front. First it announces its going to invest in wind, now comes the news the Google brains are going to be applied to replacing coal. From TechWorld:

Google co-founder Larry Page said:

“We have gained expertise in designing and building large-scale, energy-intensive facilities by building efficient datacentres. We want to apply the same creativity and innovation to the challenge of generating renewable electricity at globally significant scale, and produce it cheaper than from coal. We are optimistic this can be done in years, not decades.

Building data centers is obviously not the same as solving the world’s energy needs, but I can’t deny Google’s potential to make an impact in a space that needs more investment and attention. If I ran GE I would be be keeping a very close eye on Google. Its true though- analysts don’t get it.

Its not just Google getting in on the act of electricity generation- BT recently announced plans to invest heavily in wind power. Now I learn from ComputerworldUK that HP is initiating a major solar power program to lessen it reliance on outside sources. “The company has signed a contract with SunPower to install 5,000 solar-power panels in its San Diego facility. The installations will cover 10% of the energy used by the facility and save HP £375,000 in power costs over 15 years.”

The chief energy/electricity officer- is it really so far fetched corporations would create the role when energy supplies aren’t guaranteed. its fine to rely on market solutions, but when the market isn’t perfect (and markets rarely are, especially with geo-politics involved) supply is far from certain. Russia is in a positionto turn Europe’s gas off. We’ve arguably already hit Peak Oil, the point at which we stop finding new economic deposits.

When technology companies start their own electricity generation efforts you know the wind is changing. The lights are going on because we’re getting worried about the lights going out.

I would imagine also that most Saas or similar services have an environmental/energy cost as a significant portion. I would’nt be surprised to see Google leveraging efficiencies on this front as a competitive argument.

It could almost come down to $5 + YKjoules or X carbon units per user per month or some such

These appliances would come on and go off depending on the load on the network at any particular time i.e. more likely to come on on a windy night when wind energy is making a significant contribution to the grid and less likely to come on on winter evenings between 4pm and 8pm (when there is peak demand).

@monkchips – just to elaborate on the A+ rated domestic appliances – don’t necessarily think on/off. Remember, you could always shift the thermostats up or down depending on whether you wanted to stimulate or reduce demand.

In an industrial setting think about refrigeration plants. Get them to consume energy by turning on their compressors (by reducing the temp on their thermostats) when grid demand is low and then come off the grid (by increasing the temp on their thermostats) when demand is high.

Google is the biggest offender – from what I heard from an industry source, Google has lobbied against disclosing their carbon emissions, and are lobbying (along with Intel) to obstruct transparency in the industry. They are bigtime polluters, hoping to avoid the scrutiny they deserve… put solar panels wherever you want, it aint going to make a dent in 2,000,000 servers and storage spindles.